December 07, (THEWILL) — A disturbing image has emerged regarding Nigeria’s looming food crisis. This situation indicates a perilous trend that jeopardises the expansion of the Gross Domestic Product (GDP) and the stability of foreign exchange, among other notable economic achievements.
In the third quarter of 2025, Nigeria’s economy experienced a growth of 3.98 percent, reflecting a modest increase from the 3.86 percent recorded during the same quarter in 2024, as per the latest GDP report published by the National Bureau of Statistics (NBS) on Monday, December 1, 2025.
The NBS highlighted that the economy has maintained moderate growth despite ongoing challenges, emphasising enhanced activities in sectors such as crop production, telecommunications, real estate, trade, and financial services.
Olayemi Cardoso, the Governor of the Central Bank of Nigeria (CBN), stated that Nigeria had entered a new era of macroeconomic stability following two years of extensive reforms that had reduced inflation, bolstered the naira, reinstated discipline in the foreign-exchange market, and set the economy on a more secure trajectory towards sustainable, broad-based growth.
During his address at the annual Bankers Dinner in Lagos on Friday, November 28, 2025, Cardoso also mentioned that Nigeria’s foreign reserves had risen to $46.7 billion, the highest level in nearly seven years. This development suggests an economy that is rapidly recovering from prolonged stagnation, providing hope for an improved standard of living for its citizens.
Despite these optimistic projections, Nigeria is grappling with a severe food crisis that, in tangible terms, endangers the lives of its population and poses a potential threat to sustained economic growth. While the NBS data indicates a decline in food prices and other favourable metrics, the actual lived experience tells a different story.
The hunger crisis
Currently, Nigeria is recognised as a global hunger hotspot, ranking among the top 10 hungriest nations worldwide. In the latest 2025 Global Hunger Index (GHI), it received a score of 32.8, indicating a critical food crisis.
As reported by the GHI, Nigeria is positioned 115th out of 123 countries, with a GHI score of 32.8, which signifies a “serious” level of hunger. This ranking highlights a worsening food security crisis, driven by issues such as poverty, inflation and insecurity.
Forecasts suggest that at least 33.1 million individuals across 26 states and the FCT will experience a food and nutrition crisis from June to August 2025. Furthermore, the UN’s World Food Programme (WFP) and the Food and Agriculture Organisation (FAO) have identified Nigeria as a significant hunger hotspot in Africa.
Conflict and insecurity, particularly in Northern Nigeria, have displaced farmers from their lands, severely affecting food production. The high inflation rate, especially in food prices (which has exceeded 40 per cent), currency devaluation and widespread poverty have rendered food unaffordable for many households.
Most concerning is the fact that a substantial number of farmers have fled their ancestral homes and are now residing in internally displaced persons (IDP) camps, where they struggle with famine, disease and deplorable living conditions. Benue and Plateau States, known as the nation’s food baskets, are grappling with insecurity, having lost their agricultural lands to armed bandits. This has adversely affected backward integration.
Backward integration
Backward integration refers to a strategy where companies are motivated to produce their own raw materials by either purchasing from suppliers or establishing their own farms to cultivate produce for their factories. Those involved are mostly farmers.
Consumer goods companies, in particular, have embraced the initiative introduced by the Federal Government in the 1980s and have made significant progress in its execution. This has benefited MSMEs, especially those involved in the agriculture and transport value chains.
For example, Nestlé Nigeria once launched a project aimed at engaging 5,000 small holder farmers, initially to supply raw materials for its agro-business operations. The initiative known as the ‘Developing Inclusive Grain Value Chains Project’ was established in collaboration with IDH — a Sustainable Trade Initiative and the TechoServe organisation.
The practice of backward integration has supported Nestle Nigeria’s operations during times when other manufacturing companies, which depended heavily on imported raw materials, found themselves in a difficult position due to significant foreign exchange scarcity in previous years. This context underscores the importance of the turnaround experienced by the food-related company in the recent past.
Research has indicated that many successful businesses engaged in the value chain of leading manufacturing firms, under the backward integration policy, have been compelled to either reduce their operations or cease business entirely due to the ongoing security crisis throughout the nation. The most adversely affected are the micro, small, and medium enterprises (MSMEs).
Pessimistic projections
Experts predict that Nigeria may be on the brink of a serious food crisis by 2026, as farmers nationwide, especially in the North-Central, North-East and North-West regions, express concerns that rising production costs, insecurity, and significant post-harvest losses are leading many to contemplate leaving agriculture altogether.
From Niger to Nasarawa, Kogi, Benue, Plateau, and Kaduna states, small and medium-sized farmers are expressing their frustrations over the skyrocketing costs of essential inputs such as fertilisers, fuel and labour, which have rendered farming increasingly unviable – all linked to the worsening insecurity.
Many farmers have warned that if immediate action is not taken, the country could experience a mass departure from farming, resulting in severe food shortages in the coming year.
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
